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close this bookPromoting Sustainable Human Development in Cities of the South: A Southeast Asian Perspective (UNRISD, 2000, 56 p.)
close this folderIV. Focus on Southeast Asia
View the document(introduction...)
View the documentThe Philippines
View the documentThailand
View the documentIndonesia


Southeast Asia comprises 10 countries. The largest, Indonesia (the fourth most populous country in the world, with around 200 million people), is a sprawling archipelago along the southern boundary of the region. The next largest country is Viet Nam - a long, thin strip of land along the eastern boundary of the main landmass with a population of just over 100 million. The Philippines, comprising an extension of the Indonesian archipelago up the eastern side of the region, matches Thailand, at the centre of the region, as the next most populous (around 70 and 60 million, respectively). Malaysia has a population of just 20 million, followed by five other small countries - which include the affluent micro states of Brunei and Singapore.

Concerning recent political development of the region, with the exception of Malaysia and Singapore, which have possessed democratic regimes over a longer period, the abandonment of authoritarianism has been slower than in other regions of the world. The Philippine dictatorship collapsed in 1986, followed in 1992 by Thailand (which has had a mixed history of quasi - democracy alternating with military dictatorships going back to the establishment in 1932 of a constitutional monarchy). The Suharto regime of Indonesia, although nominally democratic, was (as we shall see below) in practice a regime of strong social control that collapsed only in 1998 after 32 years in power. Several more or less authoritarian regimes remain in the region.

In terms of economic development, the region demonstrated throughout the 1980s and into the 1990s a very rapid rate of growth, albeit with great variations. Singapore was already a significant industrial and commercial centre and Malaysia and Thailand were transformed from predominantly primary producing countries to countries with a significant manufacturing base. Indonesia, starting from a lower level of economic output, also grew fast, with rapid development of manufacturing industries in the subregions of the two major Javanese cities of Jakarta and Surabaya. The Philippines was the only major country to miss out on the industrial development boom (Viet Nam, developing along its own path, was also growing rapidly).

All this changed dramatically in July 1997 with the collapse of the value of Southeast Asian currencies. There are clearly many dimensions to this collapse involving structural problems of the Southeast Asian economies and the way in which these had been developing (Evans, 1999). We can be fairly certain, however, that the mechanism most responsible for the dramatic nature of the collapse was the decision, emanating from the advance of liberalization, to float the exchange rates of the Southeast Asian currencies.

The currencies of all the countries of the region that participated in this action (and including the Republic of Korea) dropped more or less precipitately. A broad swathe of industries went directly into bankruptcy as a consequence of their inability to afford inputs or to service interest payments on capital borrowed in hard currencies. Unemployment, in a situation of inadequate or non - existent social security systems, coupled with sudden rises in the prices of even basic commodities, expunged within two months a decade or more of gains that had been made in reducing the numbers of people living in poverty.

By the end of 1997, the currencies had been stabilized and began to climb back towards their previous levels. On the whole they re - established themselves somewhat below their pre - July 1997 levels. Long - term damage had been done and the ordinary citizens of the East Asian countries were considerably worse off than before the onset of the crisis. And yet the remedies put forward remained those of neo - liberalism, underlain (particularly in Indonesia) by continuing ad hoc emergency "social safety net" measures.

No significant debate arose as to whether the form of the development path - especially the continuing liberalization of the economies - was a good thing for the countries and in particular the majority living in impoverished or modest circumstances. It was against this background that the discussion in the following pages, of the development of local attempts at sustainable development planning and management in the urban context, must be understood.

Following this brief overview of developments in South - East Asia as a whole, three major countries of the region are analysed in more detail, focusing attention on participatory approaches to urban development. The Philippines, Thailand and Indonesia are all countries that are undergoing significant political changes following the collapse of authoritarian regimes. There are some similarities but also many differences in recent social, economic and political evolution as they impact upon development of initiatives in local sustainable development planning and management that are interesting to compare. It is hoped that, together, they provide a significant general view into progress and problems in this respect that contain lessons that are very broadly applicable.

The Philippines

The Philippines is being urbanized rapidly - an estimated 60 per cent of the country's population lived in urban areas in the late 1990s.3 There are around 65 urban places classified as cities, with the greater Manila area (Metro Manila) containing almost a third of the total urban population in the early 1990s. However, the cities are not the major attraction for rural population and it is in fact the emergence of new urban areas out of erstwhile rural settlements (a rapid growth of towns exceeding 50,000 population) that is the most significant component of urbanization in the Philippines at the present time.

3 Unless otherwise noted, information in this section is derived from Samol (1998) and of the author's own experience.

As administrative centres, and generally possessing more dynamic economies, the urban areas have inevitably attracted a population seeking a way out of a declining rural economy. A significant proportion of urban development is informal in nature. In the early 1990s, almost 50 per cent of the country's population lived below the official poverty line and even in urban areas over 40 per cent were living in poverty (UNCHS, 1996).

This clearly means that much of the population has little or no resources to contribute towards any general improvement in urban conditions. Although the Philippines was not hit as badly as other countries in the region by the currency collapse of July 1997, the backwash of the regional depression, nevertheless, also affected it - with a general retrenchment of living standards and a significant return of the urban poor to the countryside.

The efficiency with which the urban areas are working and the quality of life for most of the population are clearly sub - optimal. Attempts to redress this situation inevitably become the main focus of attention with regard to the efforts of local authorities (referred to in the Philippines as "Local Government Units" - LGUs) and communities alike. Here is a list of what are generally deemed to be the most serious environmental problems faced by the inhabitants of towns and cities in the Philippines (DENR, 1997).

Municipal water supply systems serve only a portion of the population with the poor having to buy water from private vendors at inflated prices; virtually all water supplies are contaminated. Totally inadequate wastewater management leads almost everywhere to the gross pollution of urban waterways, groundwater and coastal areas. Only 40 per cent of urban solid waste is collected - the rest being informally burned (adding to local air pollution) or dumped. Flooding (due to both inadequate drainage and inadequate flood protection measures) is perennial particularly in areas occupied by the poor. Urban air pollution is chronic - most significantly from "jeepneys", which form the main means of transport for the poor.4 It is no coincidence then that in many urban areas respiratory ailments top the list of health problems.

4 Newly purchased, these ubiquitous public transport vehicles possess second-hand diesel engines imported from Japan where, beyond a certain number of running hours, their pollution standards are no longer legally accepted.

For the poor, however, a high priority issue is insecurity of tenure as a consequence of both confused land right laws and squatting. But above this is clearly the preoccupation with the exigencies of poverty: where the next meal is going to come from. In the context of these urgent preoccupations, it is difficult to generate any broader initiative towards participatory urban planning and management among a substantial proportion of the urban population.

Looking now in general at the issue of "sustainable human development", it must be emphasized that at the level of national policies and programmes the Philippines has displayed considerable concern (Meyrick, 1999). On the one hand, as discussed further below, policies, especially in the new framework of democratization, focus considerable attention on poverty alleviation. One of the most important initiatives of the central government is the Social Reform Agenda, formally adopted in 1996 by Executive Order. Within this, LGUs are directed to lead the implementation and monitoring of their local Social Reform Agenda in co-ordination with the basic sector organizations.

Concerning "sustainable development", it is notable that, even before UNCED, much attention was being paid to the subject. Already in 1989 the conceptual framework for the Philippines Strategy for Sustainable Development was approved and the principles of the strategy were formally integrated into the 1993 - 1998 Medium Term Philippine Development Plan. Following UNCED, the Philippines Council for Sustainable Development (PCSD) was established. It was chaired by the National Economic Development Authority (NEDA), operated in close partnership with the Department of Environment and Natural Resources (DENR), and included a wide range of civil society stakeholder interests. Overseen by the PCSD and following wide consultation, a national Agenda 21 was published in 1997, followed by a government memorandum directing LGUs to incorporate the principles of the Philippines Agenda 21 into their Social Reform Agenda.

However, at the level of the Local Government Unit and local community, urgency of immediate exigencies, described above, has crowded out any strategic thinking about what might constitute sustainable, as opposed to unsustainable, solutions to local problems. The national and regional offices of the DENR have supported certain campaigns in co-operation with national NGOs - for instance regarding the rehabilitation of urban rivers and moving from a solid waste disposal regime to one of "zero waste" (reduction, reuse, recycling). However, the impact of national agencies has receded considerably in recent years with the implementation of the Local Government Code (LGC).

Following the collapse of the Marcos regime in 1986, a major concern was to disperse power from the centre to the localities and to provide political space for voices from within civil society. In the first instance this was enshrined in the new constitution, adopted in 1987, which stipulates a greatly augmented role for Local Government Units, and in which an important role is envisaged for NGOs and POs (people's organizations).

With regard to empowering LGUs, this was legislated for via the Local Government Code, enacted in 1992 and implemented from 1994. Of this law, running to almost 100 pages, it has been said that it is " of the most comprehensive and progressive decentralization policies in the developing world" (Samol, 1998:12). On the one hand, provincial governors, urban mayors and barangay captains (barangays are neighbourhood units) are elected and act in conjunction with elected councils at each level. Various other advisory councils also came into existence, the most important of which were the Local Development Councils (LDCs) and Barangay Development Councils (BDCs), which are intended to formulate local development plans with the participation of key local stakeholder groups. The LGC stipulates that at least a quarter of the total membership of these councils should comprise NGO and PO representatives.

The responsibilities of LGUs are greatly augmented and there has been a major reallocation of government personnel aimed at facilitating the carrying out of new functions. The budget allocated to LGUs has risen from 20 to 40 per cent of government revenues. In addition to providing LGUs with the remit and resources to organize local development - and with an emphasis on addressing the needs of the poor - further legislation has been passed (the Urban Development and Housing Act, 1992). This was followed by the repeal of the anti - squatting laws (1997), which directs LGUs to address more coherently one of the main problems of the poor - namely, access to land and security of tenure.

It would seem that, in terms of deciding on those components of development that are within the scope of local government, the basic structures are already in place with which, in principle, local forces can determine their own future. Thus within the limits of local decision making, they seem to be in a position to determine their own route to sustainable human development.

In part this presumes that local government will work actively in co-operation with the various organizations and interests of civil society. In fact, among the three countries surveyed here, the Philippines has the most active NGO community with a notable proportion of the urban population engaged in NGO and PO activity (Webster and Saeed, 1992). National and local urban development NGOs have been instrumental in facilitating some exemplary local projects and national campaigns particularly in the area of environmental improvements. On the other hand, most poor communities have formed POs, often with the support of NGOs and particularly of church organizations. In some urban areas these have come together to form alliances to provide a united front vis - vis government and the key local decision makers, who in practice are those who own or control the use of land.

However, across LGUs as a whole, recent experience is far from answering the call of the new constitution or the LGC for more participatory governance. Clearly the most important local institutions that would allow civil society interests to become involved in the determination of development priorities and the allocation of the municipal budget are LDCs and BDCs. Indications are that by 1998 relatively few LDCs had actually been formed and there were very few BDCs indeed. Even where these exist, the stipulation that at least 25 per cent of the membership should comprise NGOs and POs is not being honoured. An additional problem in some cases where it is being honoured is that NGOs and POs are having conflicts with one another in deciding who should be their representatives on the councils.

In general, there remain deep - seated suspicions between local authority personnel and NGOs/POs. In part this would seem to be a legacy of the past where NGOs were opposition organizations; they now find it difficult to make the transition to organizations prepared to co-operate with the authorities. For their part, local authorities find it difficult to see NGOs as constructive partners. Perhaps the main problem, however, lies in the continued functioning of patronage systems in many localities, where traditional powerful individuals and families still dominate the political scene - tantamount to authoritarianism continuing within localities. In these cases there is little chance of any interest either in power sharing or in more open government.

So local priorities and the allocation of the local budget are generally still determined internally. In practice, this has meant that additional budgets have gone predominantly to improvements in general municipal infrastructure (the first priority being roads) with a clear potential for kickbacks, which are of relatively little benefit to the poor. Implementation of the Land Development and Housing Act, which requires LGUs to inventory land ownership and find appropriate sites for low income settlements, has been only very reluctantly carried out and then under pressure from NGOs. The poor are still greatly reliant upon their own means and have yet to find avenues to put the necessary pressure on LGUs to use their newly acquired powers and resources to address their needs more directly.

Meanwhile, the concern at national level to work towards sustainable development has not percolated through to the local level where, as already noted, LGUs pursue conventional urban development priorities and projects and NGOs and POs attempt to swing municipal priorities in favour of the poor. There seem to be many reasons for this, including the fact that neither national government agencies concerned with local development, nor the local authority associations (leagues) were involved in the development of the national Agenda 21 and so feel no sense of ownership (Meyrick, 1999).

Nor is any assistance given by the PCSD and DENR to LGUs concerning how they should interpret and implement the Agenda. There is nothing by way of a national campaign around Agenda 21. Seen from the level of the LGUs, implementation of the LGC is enough by way of augmented responsibilities and no substantive link has been made between the LGC and Agenda 21 (or, indeed, the Social Reform Agenda - albeit more emphasis is being placed upon this for self - evident reasons).

The concept of Local Agenda 21 and similar approaches to participatory local planning and management that incorporate into the local planning process participation and partnership, transparency and accountability, equity and justice, a respect for the Earth's ecological limits and a concern for future generations has so far reached only a handful of LGUs. On the one hand, there seem to be problems with translating excellent policies at the national level into actions on the ground. On the other hand, there are clear difficulties at the local level to see much beyond immediate crises and contingencies, to envisage emerging problems of the future and to plan to avoid or ameliorate these.

While NEDA's regional plans do generally consider the use of natural resources and the environment within their areas of jurisdiction, often working in close collaboration with their colleagues in the regional DENR, the major problem lies in the lack of machinery to be able to control what happens on the ground. This would require a more proactive approach to local/regional economic development (rather than the present desire to encourage almost any inward investment for the jobs that it brings and then to apply lax environmental controls for fear that it will move elsewhere). It would also require LGUs, together with urban communities, to work much more closely with the regional NEDA and DENR offices to better understand the implications of sustainable development and to collaborate on the details of implementing relevant programmes and projects.


With little over a third of its population living in urban areas, Thailand is the least urbanized but at the same time the most industrialized of the three countries being examined here, possessing the highest per capita GNP.5 Urbanization, and indeed economic activity, is concentrated in and around Bangkok to an extreme degree. The Bangkok metropolitan region (BMR) contains almost half of the urban population and if the Eastern Seaboard is included (an almost continuously urbanized subregion) this brings the regional population up to 80 per cent of the total urban population of the country. Outside the BMR cities are modest in size - only a handful containing populations much in excess of 200,000. But urbanization is occurring with some rapidity and it is expected that by 2008 half the population will be living in urban areas.

5 Unless otherwise noted, information in this section is derived from Mitlin (1998) and the experience of the author.

Although the statistics for the three countries are not comparable, urban poverty is clearly less extensive in Thailand than in Indonesia or the Philippines. In the mid - 1990s there were just under 2,000 identified poor urban communities housing about 1.7 million people amounting to 8 per cent of the urban population. (Of course not all families living in low income settlements would be below the poverty line, but the numbers of families living in otherwise more affluent neighbourhoods could also be expected to subsist below the poverty line.) The distribution of poor urban households is fairly even across the urban areas, with half in Bangkok, another quarter in the outlying BMR and the rest distributed in towns and cities throughout the country. There are few urban areas of any significance without identifiable poor communities living in makeshift conditions.

The quality of life of Thai towns and cities, reflecting the better economic situation, is less obviously wanting than is the case with urban areas in either Indonesia or the Philippines. However, conditions are still far from ideal. While water supply is generally good (even some very rudimentary poor settlements have metered house - to - house water supply!), wastewater disposal is poorly organized almost everywhere. This results in the gross pollution of local waterways and unfilled land, along and upon which are located many of the low income settlements in very unsanitary conditions (Rattanatanya, 1997). Only 42 per cent of urban solid waste is officially collected, with dumping of significant amounts of industrial hazardous waste constituting an additional problem in some parts of the BMR in particular. Air pollution is also a serious problem in certain urban locations, especially Bangkok.

Although urban poverty is relatively contained, it is not insignificant, with an estimated 15 per cent of poor households squatting - meaning that they have no legal right to any urban services and that even education is provided at the discretion of the school. The environmental conditions of poor settlements were in the past very abject - houses usually being built in flood - prone areas and over paddy fields where wastewater and solid waste accumulated in a very insanitary fashion and where precarious boardwalks were the only means of access. A few areas remain in this condition although various programmes for upgrading of basic infrastructure and introducing health programmes have improved basic environmental and health conditions notably.

The impact of currency deregulation in July 1997 was more severe in Thailand than in the Philippines with an immediate impact on industry and consequently on employment. In fact this was preceded by a major real estate crisis that had already severely reduced employment in the construction sector. Open unemployment tripled between mid - 1997 and mid - 1998, and the number of people living below the poverty line increased from 16 to 28 per cent (Lee, 1999). Measures were soon taken at the national level to initiate programmes aimed at alleviating the hardship caused. This included establishing a National Social Development Committee to devise and oversee augmented social programmes (already a priority in the new constitution), and collaborating with the World Bank, which instituted a Social Investment Fund aimed at funnelling money directly into projects in poor settlements.

Concerning sustainable development, it might be expected that, with less pressure to alleviate poverty in Thailand, more energy would be spent on addressing problems of the future concerned with sustainable development. This has not, however, been the case. There is wide usage of the term "sustainable development" by government agencies, NGOs and the media - and it also featured in the eighth National Economic and Social Development Plan (NESDP), 1995 - 2001 - albeit not in the new constitution. However, little progress has been made towards any coherent idea of what this might mean in practice.

Government agencies concerned with the environment - the Office of Environmental Policy and Planning (OEPP) in particular - have sponsored various sectoral programmes on global environmental issues. These include global warming and biodiversity. They have not, however, been studied within any more comprehensive framework regarding sustainable development in the Thai context, or how to achieve it, nor has it involved local authorities or communities.

It is only very recently that a subcommittee of the National Environment Board, including experts and representatives of various government agencies and NGOs, was convened to oversee the generation of a national Agenda 21. The draft - entitled Policy and National Action Plan for Sustainable Development - was approved by the subcommittee in mid - 1999 with the intention of gaining cabinet approval so that it can form one of the inputs to the ninth NESDP.

The concept of sustainable development has made virtually no headway at the local level. As we shall see below, there have been some initiatives in developing Local Agenda 21 processes, but these have been entirely oriented towards improvement in local environmental management without reference to the distinction between sustainable solutions and those that are questionable from a sustainability perspective.

Moving now to the issue of decentralization and democratization, following the collapse of the military regime in 1992, there was a clear popular resolve to radically reform the Thai polity, to establish once and for all a thoroughgoing democratic regime at all levels that would not be subject to frequent reversals. The issue of decentralization was directly connected with this aspiration. There was much public debate and after several years of work on the part of the constitutional commission, a new constitution was enacted in October 1997. The new constitution has much to say about an augmented role for local government and also about the right of members of civil society to participate in government decision making.

Of course implementation of the constitution requires laws and regulations and, at the time of writing, relatively little had been done to give substance to the constitutional call for decentralization. The larger urban areas (thesaban) have had democratically elected councils since shortly after the establishment of the constitutional monarchy. Where previously the mayor was appointed by the council, a new law requires separate election of mayors. The smallest rural administrative units (tambons) have now gained similar arrangements - known as "local administrative organizations" - and the smaller urban places (sukaphiban) have all been "upgraded" to thesaban, including the introduction of "local administrative organizations".

However, the linchpin of local government in Thailand has always been the provinces (changwat) and so far these have not been subject to any major change. Perhaps it would be useful to add a word here about the background to the politics of decentralization in Thailand (Atkinson and Vorratnchaiphan, 1994). Local government in Thailand is organized under the Ministry of Interior (MoI), which was the first to be established in the process of modernizing the Thai state at the end of the last century. It was given far - reaching powers to establish a strong, centralized administration specifically to guard against incursion of European colonial powers leaning against all the frontiers of the country. At the time, provincial societies saw this as a process of internal colonization, but uprisings in the early years of this century were systematically crushed. Over the years, this relationship came to seem natural - it was the prerogative of the Ministry of Interior to run the provinces and of provincial societies to accept their disempowerment.

During the recent constitutional debates, many called for the election of provincial governors and the creation of autonomous units at this level. This was openly and bitterly fought by senior officials of the MoI. The main point is that provincial governors are, in terms of status, close to ministers and run provinces almost as personal fiefdoms. The goal of many ambitious MoI staff is some day to be appointed governor of a province. On the whole, the other ministries are happy with this arrangement because they administer their programmes through provincial offices that are co-ordinated by the governor, who also plays a role in determining their programmes.

Local programmes and projects are almost entirely planned and executed by central government agencies through the provinces. The budgets of thesaban, sukaphiban and tambons are derisory and although there has been some improvement since the late 1980s, when they were not only small but diminishing (R 1992), local budgets remain very restricted. Since the Municipal Act of 1954, municipalities have had many responsibilities that they are supposed to carry out, but without untied financial resources they are not in a position to determine their own priorities or to carry out activities that are not directly supported by national government agencies. The battle to achieve genuine decentralization in Thailand - that is progressing in both the Philippines and, as we shall see, Indonesia - is by no means lost, and the constitution, together with the eighth NESDP, lends some support to those who would pursue it. But it may be some time before the provincial nexus, and with it the centralization of government budgets, is broken.

It might be conjectured that it would require effective pressure from the local level to force the situation with regard to decentralization. Of course - as we have seen in the case of the Philippines - powers given by central government do not of themselves empower local stakeholders without their active involvement.

In fact at the local level there has been considerable development of mechanisms and activities promoting participatory initiatives in Thailand (Atkinson, 1996). On the one hand, the private sector has been invited to contribute in a structured manner to the development decision - making process at national and provincial level through Joint Public and Private Sector Consultative Committees (Laothamatas, 1992). This may be interpreted negatively as allowing business interests privileged access to development decisions involving public funds, which is denied to other civil society actors. It is notable that it was with direct United States and Japanese government "development assistance", in the spirit of liberalization, that this arrangement came into being.

On the other hand, NGOs have been somewhat slower to develop in Thailand than in the other two countries under review (Webster and Saeed, 1992). Nevertheless, there have been notable successes by development NGOs focusing on the organization of poor urban communities. Also there has been a spontaneous formation in many provincial cities of active "civic groups", comprised of middle class professionals, academics and business people to promote the improvement of the urban quality of life through pressure on municipalities and philanthropic work.

At the level of poor communities, there has also been considerable activity. This has involved not only spontaneous organization and the assistance of local NGOs, but also pressure at the central level that has precipitated experiments by the Bangkok Metropolitan Authority and the institution of a national agency, the Urban Community Development Office (UCDO), for the support of community organization and self - activity. Starting in Bangkok already in 1978, poor communities were encouraged to form community committees as vehicles for both self - help and negotiating local government improvement programmes. This became national policy in 1988 and by the late 1990s almost 90 per cent of poor Bangkok communities possessed these committees - whereas in the provinces less than a quarter had yet formed any.

Many community committees have gained support from the UCDO or other sources - including international and bilateral assistance organizations - to make improvements in the local environment, create small businesses, etc. Many municipalities now possess social development offices that work with community committees - which in some cases have formed networks - to determine municipal programmes in poor areas. However, not all municipalities are responsive to working with community committees and where communities do not organize - as is the case in many provincial towns - then they are likely to lose out on the provision of services. Also, in cases without land rights the institutional environment can be very hostile.

Furthermore, there is no monitoring of the representativeness of community committees and of whether they are serving the interests of the whole community or just part of it. As yet the emphasis is entirely on making small gains within the community with little interest in influencing the wider political process and the distribution of resources at the level of the district or the municipality. Certainly there is no consideration of the long term of "sustainable development".

One further approach to participatory planning has been taken within the municipalities. This is a process initiated by a GTZ - funded project in the early 1990s (Atkinson and Vorratnchaiphan, 1996). This was initially concerned with improving environmental management in municipalities, eventually becoming an initiative to develop a comprehensive participatory municipal planning system. The initial project helped to establish multi - stakeholder committees and trained them in problem identification, prioritization, planning and implementation.

In November 1995, a year after the end of the project, the MoI issued a directive requiring all municipalities to form such committees and to adopt the planning process as a basis for municipal budget planning. While some initiatives were taken by other donors and by the Municipal League of Thailand - the latter using the concept of Local Agenda 21, albeit with very little attention paid to sustainable development - this was entirely inadequate. By the late 1990s few municipalities had done any more than assemble a planning committee and even these tended to bypass it in compiling the municipal budget.

As is the case in the Philippines, this of course relates back in part to the lack of interest in opening up the political decision - making process in a situation where traditional power brokers are able to wield power through patronage - with poor communities often their most loyal supporters. Some local NGOs have tried to encourage the municipalities towards greater participation, but on the whole there has been considerable hostility between municipalities and local NGOs - including civic groups that comprise precisely elements of the new middle class that feel the need for substantial municipal reform.

The bottom line, however, is the general weakness of municipalities. Even where these accept a more participatory approach to budget planning, the limited resources mean that plans cover relatively little of what gets done locally. The main decisions are still taken by national government agencies and private sector actors without any access to these decisions for civil society interests. There has been talk at the national level - around a notion termed "Area Functioning Participatory Approach" (AFP) - to introduce more participatory methods of planning at all non - central levels of government in line with the general requirements of the new constitution. But at the time of writing this had not borne any tangible fruit.


Although comprising a substantial landmass of some 2 million square kilometres distributed over approximately 14,000 islands, almost two thirds of Indonesia's population is concentrated on the relatively small island of Java, together with neighbouring Bali and Madura.6 Urbanization has been progressing in recent years at a rate of about 2.2 million new urban inhabitants a year, mostly in Java. By the late 1990s well over a third of the population was urban and the expectation is that over half will be urban by 2005. Javanese culture is one of small peasantry and about two thirds of the new urban population is of peasant origin.

6 Unless otherwise noted, information in this section is derived from Atkinson (1998a), as well as from the author's own subsequent experience.

Although new urbanization is distributed between growth of existing urban areas and the emergence of new towns and cities in rural areas, Indonesia distinguishes itself in regional terms by the growth of very large cities. Already in 1990 there were 10 metropolitan areas (seven of these in Java) with over a million people, and there are two more or less continuously urbanized corridors within Java that already contain almost two thirds of the urban population of the island.

In recent years the Indonesian government has had strong and coherent urban development policies and programmes, but urban authorities have still failed to keep abreast of changing conditions on the ground, where significant areas have developed informally. In the 1960s and 1970s these developments were in both inner and outer urban areas, but more recently they have been predominantly on the urban peripheries where migrants are settling close to existing villages to form what amount in extreme cases to emergent cities of informal development.

In general the state of Indonesian cities is similar to that of cities in the Philippines, reflecting the high levels of poverty and informal developments. In spite of highly structured programmes aimed at improving urban living conditions, there remain everywhere shortfalls in major areas of service provision and the state of the environment (Kusbiantoro, 1997). Nevertheless, over the past 25 years, a very extensive programme (the Kampung Improvement Programme - KIP), financed mainly by the World Bank and the Asian Development Bank, has been organized to legalize informal settlements. This programme has provided basic infrastructure, which has had notable results in upgrading large numbers of poor settlements throughout urban Indonesia.

Over the years the proportion of the urban population living in poverty steadily declined to such an extent that by 1996 official estimates put it at just 10 per cent. This situation was reversed dramatically by the currency collapse of July 1997. The value of the currency continued to deteriorate for many months after the initial shock and the rupiah hit bottom at 15 per cent of its pre - crisis exchange value against the US dollar.7 The impact was immediate and dramatic, resulting in the collapse of industry. For instance, in Surabaya, on one major industrial estate alone, over 10,000 workers were made redundant within a matter of weeks. By mid - 1998, 20 per cent of formal sector jobs in Indonesia had disappeared and GDP had declined by 15 per cent (Lee, 1999). The prices of staple foods climbed so high that the spectre of mass starvation arose and the government initiated an emergency programme to distribute the "nine basics".

7 By the middle of 1999 it had returned to 35 per cent of its pre-crisis level but remained unstable.

By mid - 1998 government estimates put the proportion of the population subsisting below the poverty line at just under 40 per cent - and rising. The International Labour Organization (1998) estimated that this would rise to over 60 per cent by the middle of 1999 and in mid - 1999 the World Bank confirmed that, in spite of superficial indications of economic recovery, poverty was indeed continuing to rise. By mid - 1998 all major international and bilateral development agencies had instituted some form of emergency assistance programme for the country (BAPPENAS/UNDP, 1998) and each government agency was making its own contribution to construct a "social safety net" and other aspects of emergency relief.

Regarding the orientation towards sustainable development, it would seem prima facie that under current conditions it might be difficult to focus attention on the more distant future in the form of a vision and programmes aimed to achieve sustainable development. On the other hand, the circumstances should cause some introspection as to the wisdom of previous development efforts involving inward investment to develop manufacturing industry based on cheap labour under a regime of liberalization. Unfortunately, none of the emergency programmes is interested in supporting any reconsideration of what might or might not be sustainable by way of development in the future - with the implication that the solution is to continue past efforts but to try harder.8

8 One USAID emergency project is entitled "Sustained Liberalization of International Trade and Domestic Competition for the Mutual Benefit of Indonesia and the United States".

The Indonesian government did sign Agenda 21. With external assistance and under the supervision of the Environment Ministry - and the rather restricted involvement of the wider public - a national Agenda 21 was also produced and published in time for the 1997 "Rio Plus Five" conference. This is a very substantial but very technical document produced with little success in gaining the attention of actors who might be in a position to implement its recommendations. Virtually no notice has been taken of the document either by the media or by relevant government agencies (those responsible for determining the form that national development should take).

The term "sustainable development" has made some headway in popular discourse, as reflected by its use in the media, but has not gained any substantive meaning. Except in a few cities (as discussed below) it is not yet part of the discourse of urban planners and authorities regarding directions that should be taken by local development programmes and projects.

Concerning political developments, it is clear that it was the economic crisis (which, in fact, included a major drought and the ecological disaster of forest burning) that precipitated the collapse of the Suharto regime in May 1998. This government, masquerading as a democratic regime, was in practice a more thoroughly organized form of authoritarianism than in either of the other two countries under review (Schwarz, 1999). Of the three permitted political parties, one was the official party with the electoral system heavily favouring its continued hold on power; it in turn elected the president. The institutional framework of government down to the community level incorporated machinery, including press censorship, designed to keep the existing political system firmly in place.

Political unrest, sometimes of a violent nature, had been growing, but in the end it was probably external pressure that convinced the military to cease supporting the president - forcing him to resign. Immediate steps were taken to start the process of genuine democratization and decentralization. However, calls for constitutional reform were resisted and the decision was to continue with an interim regime passing legislation to implement the urgent demands for reform.

Among the first reform legislation, what most interested the general public was freedom of expression and opening up the electoral process to new political parties, with the aim of having new national elections take place at the earliest opportunity. However, although of less public interest, legislation concerned with the decentralization of government and the associated redistribution of government funds enacted in April 1999 has the potential to be considerably more far - reaching in impact.

Throughout the Suharto era, government was highly centralized. Provincial governors and district heads, including urban mayors, were appointed and, although there were elected councils, these only had an advisory function. Local government was essentially central government operating at the local level - their budgets were very small, not even adequately covering staff costs, and all development costs were covered directly from central government budgets with spending determined by central government agencies. Consequently, local programmes were extremely uniform in design and implementation, and therefore often highly inappropriate, resulting in wastage of considerable resources.

The World Bank and the Asian Development Bank, with some involvement of other external development agencies, lent support to local "integrated urban infrastructure development programmes" throughout urban Indonesia, ostensibly designed to make investments appropriate to each city. Nevertheless, in practice local involvement was half - hearted in view of the lack of any genuine local ownership of the programme (Atkinson, 1998b) and major decisions concerning methods and standards of delivery remained with the central government or with external consultants.

The April 1999 legislation - to be implemented in stages until the end of 2002 - appears to change this fundamentally, leapfrogging the Thai attempts at decentralization and coming closer to the situation in the Philippines. The focus of this basic legislation is upon creating autonomous local government at the district and city levels at the expense of both central and provincial government. As in the past, elected Legislative Councils (DPRDs) are called for, but these now have a legislative function and are empowered to appoint the mayor.

Nevertheless, the umbrella legislation is very open to interpretation - seen in one analysis as still offering government the possibility to dictate local policies and programmes from the centre (SUDP, 1999). The point is that central government agencies may still issue regulations aimed at local government functions and, in practice, are doing so, but that these are now ostensibly only advisory. Local governments, unsure of how to proceed with their newly won freedom, may simply succumb to central government "advice", thereby making it equivalent to directives. This is likely at some stage to come to the courts when the more self - confident municipalities decide that they want to do things their own way.

Municipalities will also have a substantial development budget and be in a position to determine both how it should be spent and how it should be administered. Specific legislation is being enacted on combating the corruption, collusion and nepotism in government (widely discussed under the acronym of KKN - korupsi, kolusi dan nepotism) that was so structurally embedded in the old system.9 Reference in the legislation to accountability and in particular the involvement of the general public in the decision - making process is, however, sketchy, being referred to only in the regulations and then leaving the format of participation open. One mechanism referred to is that of "urban forums", which local governments are expected to organize periodically to promote discussion between government and the public.

9 The nature of "corruption" as a system of allegiance-building within government, where inadequate salaries are supplemented by payments to staff, some legal and some illegal, made by those in a position to obtain and dispose of money, is now becoming well-understood. In this light, structural measures may be taken to destroy the system and create a more public service-oriented attitude among public servants (Manning, 1999).

As yet, the legislation is in a state where it is being digested. Elections for members of both the national parliament and local legislative councils were combined and held in June 1999. The next stage will be the appointment of the mayors. So far, however, there is little understanding of how the local bureaucracy might be reorganized to suit local needs. The budget planning process in 1999 was as in previous years (a rigid system controlled by the central government), but in future years local budgeting processes will come into operation and it will be crucial to find means of planning that will genuinely respond to local needs.

So who is concerned with these issues? Looking at organizations of civil society it is a remarkable fact that, even before the collapse of authoritarianism, there was a reasonably strong NGO movement in Indonesia (Webster and Saeed, 1992). As long as they were not overtly political (and many of them were covertly so), they were tolerated and acted in many fields including legal rights, the environment and development issues (Korten, 1987). In the field of urban development there were many initiatives assisting informal communities to organize, albeit predominantly around self - help improvements (URDI, 1999) with no ambition to influence the wider decision - making process regarding the direction and allocation of resources across the town or city as a whole.

Following the fall of the Suharto regime, the floodgates opened to debate and experimentation. Many different initiatives are being developed and the paragraphs that follow focus particular attention on the case of Surabaya, Indonesia's second city located in east Java, with a population of a little under three million in a metropolitan region of almost eight million. It is important to note that Surabaya has prior experience of participatory urban planning. In the 1970s a low income settlement upgrading programme was implemented within the general framework of the KIP (encompassing two thirds of the city's population). This was unlike other Indonesian cities where measures were determined by bureaucrats and their consultants. In Surabaya there were genuine experiments with participatory methods of determining what should be done and how to do it (Silas, 1992). The circumstances that encouraged this were an enlightened mayor working closely with the Surabaya Institute of Technology (ITS) within what is the most affluent municipality in Indonesia.

With a new mayor, appointed in the early 1990s, the participatory approach declined. After the fall of the regime, newly vocal local NGOs accused the old programme of being interested only in self - help and local improvements, rather than empowerment of poor communities to be able to make broader demands on the political system.

In the spring of 1997 a German government - supported project was initiated in Surabaya with the intention of assisting in the development of participatory decision - making processes around improvements in the quality of life at the community level; in the first instance this was to be little more that building on and systematizing the earlier KIP experience. Four communities were selected out of an initial 12 via wide consultation. Universities were commissioned to organize rapid appraisals of the communities, including a stakeholder analysis to help bring together a "forum" that would represent main groupings within the communities and be trained in local planning. The formation of Environmental Communication Forums (FKLHs), followed by a process of training and involvement of the wider community, was organized by local NGOs and the results were twofold - the production of local plans and more aware and vocal communities able to make structured demands of the municipality.

There is always a danger that such initiatives can collapse if the plans are not implemented. While the intention was that these decision - making forums would come to occupy a place in the overall budget planning for the city, this was certainly not immediately on the cards. Some city departments co-operated, including the city water supply corporation. Then the project succeeded in collaborating with the emergency programme of the national Public Works Department, which had to disperse large amounts of money in a short period and was happy to find local ventures into which they could channel their funds.

But it was clear that these - in the first instance predominantly self - help - initiatives would die once the project ended unless there were a considerably more coherent institutional framework within which they would have an ongoing place and function. Already before the collapse of the old regime, the project was attempting to bring together key stakeholder groups at the city level. This had the intention of bringing into existence a more or less formal pressure group to voice the concerns of civil society - and promote the local community plans - at the level of the city authorities. Whether this could have worked under the old regime is a moot question.

With the collapse of the regime the intended forum - initially christened Sustainable Development Forum (FKPB) - immediately initiated debate around issues that should become the focus of reformed local government. Indeed, both the mode of organization of the community initiatives and the FKPB became the focus of attention of the now reform - minded central government and external assistance agencies as indicating possibilities for public participation in local government decision making. USAID immediately undertook to assist a number of other cities in east Java to establish FKPBs albeit with close ties to government.

However, as we have seen in the cases of the Philippines and Thailand, the abandonment of authoritarianism does not immediately bring clear reform. Of particular interest in the local debate in Surabaya is the insistence of the FKPB to be independent of government. Some NGOs accuse it of wanting to collude with government even before it has taken any substantive initiative to do anything in collaboration with local government. The fear of co-optation that was so often the experience of NGOs in the past when they attempted to promote civil society interests is strong and even private sector and university participants in the process steer a careful path. The initial preference is to advise the newly democratic Legislative Council rather than to engage directly with the machinery of local government.

On the other hand, it is clear that, at this point in time, the field iswide open to non - government initiative to help define what local government is to become in the future. If, however, local government is left to its own devices there is a real danger that entrenched interests will succeed in establishing local authoritarianism as is evident in so many local authorities in the Philippines and Thailand.

In fact, the preoccupations of the FKPB - and one might say of the local forces of reform more generally - are not yet oriented towards "sustainable human development" in any very coherent way. The initial priorities of the FKPB are environmental pollution, land and settlement including tenure, the informal economy and provision of public services. Work is proceeding actively on the first two issues partly because there happen to be people active in these issues. While it is clear that these - and particularly the issue of land - are relevant to the needs of the poor and possibly also to achieving a more sustainable city, in practice, the debates remain at some distance from the prima facie needs on either score.

The FKPB is not making common political cause with the poor: attempts to involve the interests of the poor (for example, associations of informal traders and pedicab drivers) have not been successful and membership of the forum is, with the exception of a very active trade union representative, exclusively "new middle class", albeit with some young and active NGO people.10 Although originally named the Sustainable Development Forum there seem to be too many urgent issues to be dealt with to be able to focus serious attention on what might constitute a coherent and effective approach to sustainable development. The result is that after one year in existence the Forum renamed itself simply the Surabaya Urban Forum (FKS) in order to be seen as more mainstream and meriting a central position in the emerging system of local government.11

10 The importance of youth as the driving force of the reform process in Indonesia at present can hardly be overstressed, where much of the new middle class is too tainted with KKN to be seriously committed to fundamental reform.

11 The new legislation calls for the convening of forums as a means of communication between municipalities and other stakeholder groups. In fact the legislators already had the Surabaya experience in mind; now the members of the FKS wish to ensure that they are seen as the legitimate body to fill this role!

In other towns and cities throughout Indonesia, similar experiments and experiences are unfolding spontaneously (active NGOs working with local government) or with external assistance. Indeed, the growth in assistance programmes as a consequence of the emergency has meant that programmes are tripping over one another in all the major cities. It thus becomes advisable (this is happening in Surabaya) to hold regular co-ordination meetings among the various initiatives with, even then, a constant danger of contradictory initiatives and wastage of resources. Most of the effort (such as the massive World Bank and Asian Development Bank poverty alleviation programmes designed to channel money directly into local communities) is focused on improvements to the environment of poor communities - essentially KIP based on new participatory decision - making processes.

Much of this experience encounters the inevitable contradictions between large - scale programmes and the need to be sensitive to local contingencies, which often takes more time to resolve and greater sensitivity to specific local circumstances than such programmes are prepared to countenance. Furthermore, they have little or no interest in empowering communities in the sense of orienting them to voice their needs in the wider political process.

These ostensibly participatory initiatives could potentially be very counterproductive. There is a tendency for agencies to bypass local authorities and work directly with the community. Some local authorities may attempt to use the freedoms and opportunities created by the recent decentralization laws by adopting new forms of command - oriented government with perfunctory measures of public consultation designed to legitimate their own activities rather than respond to locally expressed needs. But there are also various attempts to work at the city and provincial level, as in the case of the FKS in Surabaya, to devise means to ensure that the local governments of the future are held accountable and do have a more positive orientation towards participation and sustainable development.